This is the forecasted sales for June.
The formula to calculate a forecast using exponential smoothing is Ft+1 = α Yt + (1 ? α) Ft Where: Ft+1 = forecast for the next period Yt = actual value for period t Ft = forecasted value for period t α = smoothing constant (0-1) To calculate forecasted sales for July, we first need to calculate forecasted sales for June, because that figure is needed to calculate forecasted sales for July. June forecasted sales = (0.7 × $22,000,000) + (0.3 × $21,400,000) = $21,820,000. July forecasted sales = (0.7 × $22,500,000) + (0.3 × $21,820,000) = $22,296,000.
This answer results from reversing the 0.7 smoothing constant and (1 ? 0.7) in the exponential smoothing formula.
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